Federal Administrative Arbitration At-A-Glance

These guidelines apply only to federal agencies' use of arbitration in administrative and contractual matters, not to the use of arbitration by litigators to settle a case in federal court

The Administrative Dispute Resolution Act of 1996 imposes several statutory requirements before federal agencies may use any type of arbitration

For any type of arbitration, all parties must consent to arbitration either before or after the dispute has arisen

The arbitration agreement covering the specific subject matter must:

have a cap on the amount of monetary relief the arbitrator(s) can award
must be in writing
may limit the range of potential other outcomes or remedies
recommended: that the range of potential non-monetary relief an arbitrator is empowered to order is specified in the agreement

The federal official who consents to arbitration must have authority to use arbitration or otherwise have settlement authority for the subject matter of the dispute

Prior to the use of binding arbitration, the agency head must have issued guidelines on the appropriate use of binding arbitration in consultation with the Attorney General

As of August 2009, the following agencies have issued such guidance: Federal Aviation Administration, the Federal Deposit Insurance Corporation, the Federal Motor Carrier Safety Administration, the Department of the Navy, Presidio Trust, and the Department of the Treasury, Internal Revenue Service.

Federal ADR officials who have questions or need advice should contact Joanna M. Jacobs, Office of Dispute Resolution, U.S. Department of Justice, by telephone at (202) 305-4439 or via email to: joanna.jacobs@usdoj.gov.


Updated November 26, 2021

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